Guidance on Construction Loan TRID Application

A common issue for lenders following implementation of the TILA-RESPA Integrated Disclosure (“TRID”) Rule has been the context of construction loans. With the economy recovering in many parts of the country, construction is moving forward at a more rapid pace, and construction loans are more frequently issued than in years past.

The Consumer Financial Protection Bureau (“CFPB”) has now issued a short fact sheet regarding the application of TRID to construction loans. If construction phase lending may be converted to a permanent loan, then the two phases may be treated as a single transaction or multiple transactions for purposes of required disclosures. The Loan Estimate and Closing Disclosures under TRID must be issued accordingly.

You can find the new fact sheet here, and the CFPB’s TRID resource page is located here.

Please contact us if you have any questions.

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By R. Scott Adams

R. Scott Adams

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